The US dollar on failed to catch up with pace of US Treasury yields that hit new near two-year highs on their return from a long weekend break even as yen edged higher ahead of the outcome of a central bank policy meeting on Tuesday.
The Bank of Japan is likely to slightly revise up its inflation forecast in a quarterly outlook report after the meeting, due to rising energy costs, Reuters reported last week citing sources, though the new projection will still be below the BOJ’s 2 percent target.
The meeting is expected to wrap up by late morning in Tokyo.
The dollar slipped as much as 0.15 percent against the yen in early trading to 114.43 yen per dollar, and was also slightly softer versus the pound and euro.
The weakness in the dollar came even as US Treasury yields continued to gain, with the short end of the curve hitting new pandemic highs, which would normally be supportive for the greenback.
Two-year yields rose above 1 percent…